Camelot claims UK arm will cease to exist if it loses National Lottery licence
Company argues that it would suffer massive losses as a result of the UKGC’s decision to award Allwyn the fourth licence
Camelot has claimed its UK branch would cease to exist, putting its employees and revenue at risk, should the UK Gambling Commission (UKGC) proceed to award Allwyn the fourth National Lottery licence.
At the High Court in Central London yesterday, Camelot and the UKGC began the legal proceedings which could see a significant delay to the transition period.
Camelot argued that this loss would need to be further compensated by the UKGC, a claim that the regulator swiftly rebuked.
UKGC lawyer Sarah Hannaford said: “When a global company opens an office in another country, they take that commercial risk that there are potential losses if the contract ends.”
“This isn’t a kind of family business which would lose everything by losing this contract, but it’s a massive business and losing staff is a natural part of the bidding process,” Hannaford added.
It has also been argued that staffing issues work both ways; Allwyn will experience stagnation in its hiring process due to the suspension of the licence.
The UKGC has said that any delay in the transfer would cause a detrimental effect to all parties involved in the National Lottery.
Earlier this week, former Camelot CEO Dame Dianne Thompson said any delays could have a devastating impact on the good causes fund.
Camelot pushed for an expedited hearing in July, but this was denied, and a rough date has been pencilled in for October 2022.
This delay will mean that the statutory 18 to 19 month transition period will not be able to be met by Allwyn as any decision is not expected until the end of the year.
The UKGC has already said it will not be extending Camelot’s current licence due to statutory legislation.
One option available during the process is known as the ‘enabling option’. This would mean that Allwyn and the UKGC will enter into the enabling agreement, but it would not be guaranteed that the firm would receive the fourth licence at the end of this period.
Hannaford said that the enabling option “simply doesn’t work” and that it is a backdoor to get around the statutory backstop. Camelot also asked for the High Court to step in to make the two contracts separate, but Hannaford called this “an unjustifiable interference”.
IGT, Camelot’s technology partner, has made additional claims that the loss of the licence would lose the opportunity to innovate on the lottery, but these claims were quickly rebuked by the regulator on the grounds that they are “simply too vague and not quantifiable.”
Overall, the UKGC thinks that all of Camelot’s requests will cause issues and are a backdoor to get around the statutory backstop.
The regulator has said that damages are not an appropriate remedy for any potential lost profits Camelot may suffer, and neither claimants had enough evidence to make the claims they have.
The UKGC awarded the National Lottery licence to Allwyn on March 15 2022, which will see a new operator run the National Lottery, with Camelot holding the licence since its inception in 1994.
Following this, Camelot, IGT and fellow licence challenger Northern & Shell, launched legal challenges over the awarding of the licence to Allwyn. At the time, Camelot CEO Nigel Railton said the UKGC had got the decision “badly wrong” and that the process requires an independent eye cast over it.
The UKGC believes the challenge made by Camelot is just a way of delaying the start of the transition of the National Lottery licence to Allwyn.
If the suspension is lifted, Allwyn would take over the running of the National Lottery in February 2024.